PAUL GIGOT: They’re tough, Jim. I mean, I think if you ask people in the White House whether they wanted to pick this — whether they wanted this fight, whether they would have picked it if they had been offered the opportunity; I think they would have said no, because it’s tough news. It’s blackout’s it’s gas prices going up; it’s potential shortages — that sort of thing. They’re confronted with it and they had to make a choice. Do we put it off? It didn’t start under their watch after all. It started and they inherited it. Or do we address it? And they decided to put their arms around it and basically take ownership of it politically, which means offering a solution. The surprising thing here to me politically is what they didn’t do to get the short-term political bounce; they didn’t release money from strategic oil…

JIM LEHRER: As we just heard the governors talking about, nothing in the short run.

PAUL GIGOT: They’re not repealing the federal gas tax, which is a hearty Republican perennial; they’re not doing that. Instead most of this is longer term. It’s not the next Congressional recess; it’s not this summer. It’s deregulatory, increased supply, longer term. I think they feel that they’re going to get some credit if this kind of goes away within a couple of years. But in the short-term, the politics are difficult.

JIM LEHRER: Difficult?

MARK SHIELDS: Difficult, Jim, for the reasons that Paul’s saying — George Bush has a four year term. Republican House members have two-year terms. That’s why there’s a concern and anxiety and nervousness, a certain degree of bedwetting in the GOP caucus right now over the lack of short-term response to the energy crisis or the energy situation in the country. And the other problem he has is a more serious political problem, and that is not unlike Bill Clinton in 1993, 1994, the Democrats came up with a plan for national health — the presumption was the Democrats like big government and that worked against them. In George Bush’s case — Dick Cheney’s case, when they come up with an energy problem, it is being applauded by the American Petroleum Institute, where Jim Watt, the former Secretary of the Interior under Ronald Reagan said, this is beyond anything I ever dreamed of doing, then you’ve got a presumption that they are tilting too much toward the industry from which they both came, and I think that is a serious political problem, and it makes them vulnerable to charges from the opposition that this is a giveaway to the oil companies.

PAUL GIGOT: Their criticism is definition — Democrats have decided — you know, they haven’t had a lot of luck portraying Bush, getting at Bush, and portraying him as a typical Republican, and this is part of a way to try to make things look like a traditional big business Republican. The advantage Bush has here is particularly if this summer, if they’re a lot of blackouts, if there are 300 hours of blackouts, as some have predicted in California, if there is $2 gasoline, the Democrats have got to be wary of getting on the side that says, hey, we don’t need any more energy; this is, you know, and that’s a danger that they have to be wary about themselves.

JIM LEHRER: How did you read how the Democrats should play this or are playing it, or will play it?

MARK SHIELDS: I think the Democrats are basically going to be critics, rather than…

JIM LEHRER: Why? Why are they going to be critics?

MARK SHIELDS: I think because they see the vulnerability here. I think first of all when you look at California, California is in crisis proportions. I think the president has made a case for an energy plan that represents essentially the wish list of many in his own party on energy based upon two totally disparate and unconnected factors — one, the increase in gasoline and second, the electricity crisis in California.

JIM LEHRER: They don’t really, they don’t have anything to do with each other?

MARK SHIELDS: They don’t and they don’t address that, and what the president proposes doesn’t address it. California, Jim, is a real problem. It’s a crisis. You’re talking about a state where electricity two years ago cost everybody $7 billion, where this coming year it’s going to be $70 billion by some reliable estimates; that’s a tenfold increase. The economy of California is headed for crisis and disaster. We’re talking about — Paul mentioned blackouts. I was talking to economists and energy folks from California this week. Four hours a day, five days a week from the end of June until the end of September no electricity. What do you do, Jim, if you run a barbershop, if you run a small business, if you run anything? What does that do to your economy? It’s really cataclysmic.

JIM LEHRER: What do you do if you’re the president?

PAUL GIGOT: I think that helps to make — helps Bush make…

JIM LEHRER: How does that help him make his case?

PAUL GIGOT: Well, it makes the case we need to do something about this and we need to help the transmission of energy; we need to get the flow of energy; we need to get the production up; we need to really take some action. I don’t know that I’d want to be a Democrat standing up on the floor of the Senate this summer if the scenario Mark talks about unfolds saying, I’m going to filibuster this because I don’t think we can despoil our environment. Well, the environment tends to recede as an issue when more pressing issues like commuting to work and whether you can open that barbershop press it.

JIM LEHRER: But let me try another angle on that. Let’s say all these terrible things do happen this summer in California, what’s to keep Democrats from going on the floor of the house and the Senate and say we have to do something today, now to help California or this state’s going to go down the tubes?

PAUL GIGOT: And the pressure is going to rise for that. And there’s a real problem — George W. Bush and his advisers have learned they don’t… they haven’t wanted to make the same mistake that Gray Davis did in California which is to refuse to admit that there is a problem; he put it off for a long time and blamed it on his predecessor, with some justification; blamed it on the legislature, blamed it on the big utilities — you know, said they’re greedy. Well, one of them bankrupt they were so greedy. And now his approval rating has really sunk. So there is going to be a mutual blame game going on here. But ultimately the Bush people — it was interesting to listen to Bush this week. He didn’t blame anybody in his speech. He said, let’s get something done, and he’s I think — his calculation is, all right, the Democrats are going to criticize him, but ultimately as president you’re going to get credit if you can get something done.

MARK SHIELDS: He didn’t blame anybody this week. We just heard in Margaret’s segment that what has become the mantra — that there was no energy policy.

JIM LEHRER: For eight years there was no energy policy.

MARK SHIELDS: For eight years. Jim, you know, there are 3891 leases given in the Gulf of Mexico over the last eight years under Bill Clinton; the production of oil and gas on federal lands increased by double. It doubled. It went up to 26 percent of the entire national supply — went from 13 under Reagan/Bush. So, I mean, so there was an energy policy and the reality is that the Democrats are going to — I think Democrats ought to — they’re going to raise the question — the environmental question. The non-starter going into the Alaskan National Wildlife Refuge — that is a nonstarter; it’s an article of faith; it’s sort of an article of dogma for the Republicans; it’s not going to happen.

JIM LEHRER: Why isn’t it going to happen?

MARK SHIELDS: It isn’t going to happen, quite frankly, because it began under Dwight Eisenhower because it is —

JIM LEHRER: You mean the Arctic…

MARK SHIELDS: Protecting this — this little precious area. I think there’s no question Democrats are going to make the argument on the question of the environment, and the environmental cost that this involves. And it is considerable. And Paul says California — American voters are very pragmatic people. When they see tenfold increase what that does in price, they know there’s something wrong. They know there’s somebody making a buck on that. And if there’s something wrong with it you’ve got to somehow give relief to ordinary people, and that involves some sort of a federal action…

JIM LEHRER: So you think — you’re answer to my question to Paul is the Democrats would try to do something .

MARK SHIELDS: I don’t think there’s any question. I think you’re looking right now at the reality that Oregon, Washington, and California are essentially, in my judgment, written off by the Republicans in this policy politically.

PAUL GIGOT: The problem is the price caps, which is what Gray Davis wants, price caps in the short-term, you know, they do — they give you some political boost. In the long run, as Jimmy Carter discovered in the 70s, they reduce the supply of energy, the incentive to — and they don’t do anything about demand, people talking about conserving energy, but the problem is that if you put on price caps, you don’t conserve as much.

JIM LEHRER: It’s going to be an interesting summer. New subject: Nomination of Ted Olson to be solicitor general. The Senate Judiciary Committee 9-9 goes now to the floor next week or apparently next week for a debate. What’s going on?

MARK SHIELDS: Well, what’s going on. I think there’s a couple of factors going on. First of all, Ted Olson is a very able lawyer; his severest critics acknowledge that. He’s a fierce partisan. And he’s nominated to solicitor general by an administration that wants to change the tone in Washington. This is probably the most high profile Republican lawyer, partisan lawyer in the city, and they’ve chosen him to be solicitor general, who’s the 10th Justice of the Supreme Court, so there was going to be some —

JIM LEHRER: Explain — the solicitor general represents the government of the United States before the Supreme Court.

MARK SHIELDS: That’s right.

JIM LEHRER: Right.

MARK SHIELDS: That’s right. It’s an esteemed position and not one that you think of as a campaign attorney getting. But add to that the fact that Russ Feingold, praised by conservatives everywhere, his fair-mindedness, he voted for John Ashcroft on the Judiciary Committee, only Democrat to do so. He voted for John Bolton, a very controversial nominee in the State Department, praised by the conservatives for so doing, very fair minded. I talked to him today and he voted with the Democratic majority. I mean, all the Democrats opposed —

JIM LEHRER: Against Olson.

MARK SHIELDS: He said, look, every president has a right to name his own administration as long as the time they serve with the president as opposed to judiciary — someone who’s going to be there during the president’s term. He said I have a presumption the president can name his own. Second, that — if the person meets qualification professionally, which Olson does, and third, that he doesn’t have an ethical disability that is disqualifying.

He said that’s not the case. But he said he has to be forthcoming and that Ted Olson had not been forthcoming; he’s too smart a guy to have been on the American Spectator writing articles for them and on their board and doing their legal work at a time when everybody in shoe leather in this town knew that the American Spectator existed for one purpose and that was to absolutely destroy Bill Clinton; that was it.

The Arkansas Project was funded by Richard Mellon Scaife, $3 million. I just asked Jim, if in fact, Barbra Streisand put $3 million to just have some journalist go after John Ashcroft, find anything on him, personal, professional, political , you know, would there be a scream and a hue and all the rest of it and everybody involved in it. You better believe there would. And that’s the lack of his candor and forthcomingness that is causing him the problem.

PAUL GIGOT: He was their lawyer, not their editor! Wait… You’ve had about ten minutes on this one. If you’re the editor-in-chief, you know what is going on with your reporters all the time. If you’re a lawyer, you don’t know what is going on. The Washington Post said today there is no real evidence that he didn’t tell the truth before the Committee. I think this is payback; this is payback for Bush v. Gore. He argued the case before the Supreme Court. He is a partisan and has been a partisan on occasion — no question about that. But I think that — and this is Pat Leahy as well. Pat Leahy, the chairman, the ranking member of the judiciary has really been driveless. A lot of the —

JIM LEHRER: Why? Why would he be motivated do that?

PAUL GIGOT: I think it’s payback — I really do. I think it’s some of these staffers who think you’re going to get this partisan, this guy…

JIM LEHRER: Payback for what?

PAUL GIGOT: Bush v. Gore.

JIM LEHRER: I see.

PAUL GIGOT: For what he did during the campaign.

JIM LEHRER: All right.

PAUL GIGOT: The fact the Supreme Court, many Democrats still believe, stole this election — and he was an agent of that and so they’re going to make sure he doesn’t become solicitor general.

JIM LEHRER: So you don’t think that he was less than candid in discussing the American — his role in the American Spectator thing on Clinton?

PAUL GIGOT: I don’t at all. I’ve read all the pages, talking points that Pat Leahy sent out; I looked at what Olson responded with — not at all. I mean, we were talking quibbles — whether 1997 or 1998 — and as far as politics at the solicitor general’s office, Archibald Cox, renowned lawyer, well regarded, he was deeply involved in a campaign before he became solicitor general.

JIM LEHRER: Where’s this going to end?

MARK SHIELDS: First of all, in — just to correct the record for Paul, the truth on this is that it has reached the point now where, my understanding today, both Orrin Hatch, the chairman of the Senate Judiciary Committee, and Pat Leahy, while I do not think there’s a fierce partisan by any means. I don’t think he’s being characterized as a payback guy by anyone who’s known him for 24 years in the Senate. They are going to agree to have the people involved cross-examined, interviewed by the principal staff and the counsels on the Democrat and the Republican side.

JIM LEHRER: About the American Spectator —

MARK SHIELDS: About the American Spectator issue.

JIM LEHRER: So then there won’t be a vote this week; it’ll be a while before we get it resolved?

MARK SHIELDS: No. And just to clear the record, he was writing articles under — under an alias, which he says now they were intemperate, I went too far — no, he wasn’t involved in this project…

PAUL GIGOT: Writing articles doesn’t necessarily mean you were involved in reporting down in Arkansas.

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